New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1887-09-03
GARRETT GETS A BIG LOAN.
4 SYNDICATB WILL FURNIsH ~
ZEN MILLIONS TO PAY OFF BALTIMORE
AND OHIOS FLOATING DEBT.

Baltimore and Ohio Railroad was rightly inter.
preted in Wall Street as foreshadowing merely n
virtual reorganization Of the company, There
Is no doubt that q practical dismemberment Of
the property has been decided upon although the
many rumors on the subject have little actual
foundation. 1t has been reported that the con.
troll of the company had been secured In various
interests and there has been good deal of talk
about sale OF the stock O.. tion or otherwise.
The negotiations between Robert Garrett and Alfred
Sully and afterward between him and the Ives
crowd amounted to nothing. Mr. Garrett declarcd
the latter negotiations of just before be sailed for
Europe and soon after his arrival there The
TRIBUNE announced that Mr. Garrett was arrang.
London, with a view Of placing the company on
solid basis 1t was made known yesterday that
these negotiations had Leen concluded. j. Pier.
pont Morgan said that large loan to the Baltic
more and Ohio Railroad had been made and that
1t would relieve 1t of its entire floating debt,
which has been recently oppressive In regard
to the frequent reports connecting his firm with
the negotiations Mr. Morgan said:
"A preliminary contract has been executed to-
day between the Baltimore and Ohio Railroad
Company and j. S. Morgan g. Co., Barring Bros.
g. Co. and Brown, Shipley g. Co., of London and
their allied houses on this side. The contract
provides for the negotiation OF S5,0O0,O0O Bal
tlmore and Ohio consolidated IS and of S5,0O0,0OO
Baltimore and Ohio preferred stock for the pur.
pose OF paying oil the entire floating debt of th6
company and placing it upon sound financial
basis. The conditions are: First the verihca-
ton OF statements, ETC., made second, that
the management of the company shall be placed
in competent hands satisfactory to the syndicate:
third, that satisfactory contracts shall be made
between the Baltimore and Ohio and the other
roads for Ncw-iofk business which shall remove
all antagoni SIN between them on the subject and
insure the permanent working of the Baltimore
aud Ohio in entire harmony with the other trunk
lines and also avoid construction OF threat of
construction of expensive parallel lines north
and east OF PHILADELPHIA
What will be the policy of the syndicate as
regards the telegraph, express and sleeping Car
interests /"
"lhe policy will be that the company shall bo
managed on the same basis as other trunk lines
and thus remove the antagOnism that has arisen .
from the policy heretofore pursued Tic express
contract has already been disposed Of and although
there is no necessity, far the debt OF tho
company is concerned, for dsposing OF the others,
they may or may not be sold shall be hereafter
determined. In my opinion 1t is scarcely possible
to oyerestmate the importance of these ncgotia.
tons, particularly as regards the trunk lines.
lhe syndicate Is composed Of the houses men.
TONED, and they are each and all OF them inter.
estcd in the trunk lines through the various
negotiations which they from time to time have
made. They united to protect these
interests so far as their influence and power
can do so."
Are the firms you name the only ones inter.
ested IN the syndicatc?"
Absolutely. together with Messrs. Drexel Nor.
gan d Co., Drexel g. Co, Brown Bros & Co.
and Kdder Peabody & Co., the American con-
nections."
In reply to other inquiries Mr.. Morgan sail
that it was not true that he had any interest in
a hp ot fba anI in.
regard tc the report that Mr.. Garrett had resigned
the presidency he replied simply that he had not
been advised on this point. lie would not go
| further than to say that the loan was "a business
transaction oil the greatest Importance.
GARRETTs RULE AT AN END.
1t was not until long alter the close OF business
at the Stock Exchange that the signing Of the
agreement was made pubic. One fact was ac-
| knowIedeed by every one, that the management
| Of koDcrt Garrett was an emu. Whether he
| remained nominally the head OIL the CORPORATION
was considered matter Of little consequence in
view OF the agreement with the syndicate. A
satisfactory management might inyoive many
! other things besides the virtual retirement OF
| tresident Jarrett, ana about them tic greatest
| curiosity was expressed 1t was cOn.luued at
once tndt tie syndicate would mol be saushcd
! " MAINTAIN d large aud expensive teiey raph
| system, VI, III TACT, any other auxiliary luxury,
| lie repeated denias by Omcers o, tilc heslern
Union Ieivgiapu Company were quickly explained
anu the recent advance the price Oh tnaC stock
| ana oI PuIimans fala.e Car Company stock was
eonsluereu suincienL poo. thal, the tcicgi aph
and sleeping car departments OF the Bai,imore
anu ONO hallioad nau not Leen absolutely uis-
posed oi' the Understanding ia rega.u w teen
Was perfect IL Is aouDUluI, lLueei, IL the
actual tiansIer OF the DaltImule anu Ohio Stock
to the syndicate would have been tegarued as q
| better setement Oh the difficulties that have
| recently surrounded speculation in Wan Street.
The entire reorganization OIL the company was
| IA nApls anil fna a.,
tails Us a matter OF merely routine work
| The s5,OOO,O00 preferred stock is new issue
and doubles the amount OF that class. 1t is en-
TITLED to per cent dividends The price at
which the stock and bonds are taken is not
known, but the sum realized is said to be amply
sufficient to discharge the whole floating debt
of the company The per cent bonds have been
selling at about ITO lately. The preferred stock
| is rarely quoted in tits or even the Baltimore
market. The outstanding stock is held entirely
by investors Aside from THE conditions about
| the management the new loan is practically
| funding OF burdensome floating debt although
| it is probable that a large saving in interest,"
| on this account will lc made.
The credit OF the company, which has been
seriously impaired lately, will be restored and
indeed considerable part Of the company's
| floating peper has already been taken up.
RADICAL CHANGE IN POLICY.
| The conditions imposed by the syndicate sug-
gest radical change in the policy and manage
ment Of the company. The proposed extension
to the city Is abandoned, VI course, and although
the running Of through trains may be resumer,
it will be only In connection and harmony with
other lines. The project Of Independent ter.
minal facilities on staten Island wIil be carried
out only SO tar as it may be partially adopteu by
the Pennsylvania hailroad A station may DO
esta bisheu there, but IL VIII be only for the joint
| use OF all the lines from the South and only
according to the requirements Of the traffic.
The changes in the working management have
not been uecided upon. Vice-Presiuent spencer
was recently made PRESIDENT pro ten by formal
| vote of the directors, and it is not improbable
that he may Le selected by the syndicate to
succeed Mr. Garrett in name as well as fact.
| A. j. Cassatt, formerly first vce-president OF the
| Pennsylvana Railroad, is mentioned In connec-
ton with the office. There Will De several changes
| In the Board OF Directors. but they have not been
made public, even IL they have been agreed
upon The syndicate will have its own repr' SEN
! tatiyes and 1t is hnted that the Pennsyivania
| .aiIroad and nerhans the Reading, may nave